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Business Transfers and Flood’s Effects Cause Hoya’s 3Q 2011 Revenue and Profits to Drop

February 3, 2012 12:25 AM

TOKYO— Hoya Corp. (TOKYO: 7741) announced this week that costs related to the sale of two major businesses and the impact of severe flooding that crippled its eyeglass lens production in Thailand resulted in sharp decreases in third quarter 2011 revenue and profits.

During the quarter ended Dec. 31, 2011, Hoya reported that revenues from continuing operations decreased 9.2 percent to 83,479 million yen. Profit for the term was 3,276 million yen, down 73.9 percent compared with that of continuing operations year on year, or down 74.7 percent compared with all operations.

For the first nine months ended Dec. 31, 2011, revenues from continuing operations were down 3.2 percent to 273,148 million yen year on year, and profit for the term was down 24.0 percent to 30,448 million yen. Profit from all operations was down 38.5 percent to 31,205 million yen, according to Hoya.

The significant decrease in sales and profit from last year are mainly due to the business transfer of glass media for HDD (June 2010) and Pentax Imaging Systems (October 2011), as well as the impact of the flood in Thailand to eyeglass lens business, the company said.

"Taking into account two major business transfers last fiscal year and the third quarter this year, the negative impact to our financial results are mostly due to the effects of the flood in Thailand on our eyeglass lens business," said Hiroshi Suzuki, chief executive officer of Hoya. "Otherwise we see slight organic growth. Especially in the severe business environment of electro-optics, we have stabilized our business structure to generate reasonable returns."

In Hoya’s Life Care unit, sales of eyeglass lenses declined substantially year on year, as the company reported it was unable to ensure sufficient supply, particularly to Europe and Japan, its major markets, because of the shutdown of its main plants in Thailand, in addition to the rapid appreciation of the yen. Sales of contact lenses rose year on year with an increase in the number of customers visiting stores, reflecting active consulting sales through directly-owned stores, high sales of high value-added products, and an increase in the number of stores undertaking aggressive expansion initiatives.

Sales of intraocular lenses (IOLs) rose from the previous year, thanks to brisk sales of soft lenses. As a result, sales in the LifeCare segment stood at 42,918 million yen, down 15.6 percent year on year; a segment loss (before tax) of 1,315 million yen.

For the full year ending March 31, 2012, Hoya forecasts revenues of 373,000 million yen (down 11.8 percent year-on-year) and profit of 37,000 million yen (down 37.9 percent) for all operations.
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